Pizza Pier Issues 7%, 10-Year Bonds with a Face Amount

question 37

Essay

Pizza Pier issues 7%, 10-year bonds with a face amount of $80,000 for $74,564 on January 1, 2012. The market interest rate for bonds of similar risk and maturity is 8%. Interest is paid semiannually on June 30 and December 31.
1. Record the bond issue.
2. Record the first interest payment on June 30, 2012.

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